Shares of Intersil jumped nearly 10 percent Tuesday after news that the company will be acquired by Japanese chip maker Renesas Electronics for about $3.2 billion.

Renesas will pay $22.50 a share in cash for the California-based chip maker, nearly 14 percent higher than Intersil's Monday closing price of $19.76 a share.

Renesas President and CEO Bunsei Kure said Tuesday Intersil's portfolio of analog and power devices will strengthen many of its initiatives in several areas such as automotive, industrial, infrastructure and its growing Internet of Things engagements.

"We believe that this compelling and complementary combination will bring significant synergies and cross selling opportunities as well as system solution proposition which will pave the way for Renesas to strengthen its position as a leader in the global semiconductor market while delivering value to its customers with a unique product offering," Kure said in a joint press release.

Additionally, the company said the acquisition is expected to grow Renesas' product lines where the market is expected to rise by about $3.9 billion in 2020.